Northwest Stock Soars On Rumors

June 27, 1985|By Carol Jouzaitis.

The price of Northwest Airlines Inc. stock jumped Wednesday on rumors that the Minneapolis-based carrier may be the target of a takeover by another airline.

Several Wall Street analysts dismissed the rumors and attributed the run- up to the industry`s ``takeover mentality,`` created by New York financier Carl Icahn`s attempted raid of Trans World Airlines. TWA since has agreed to be acquired by Texas Air Corp, parent of Continental Airlines.

Speculation on Northwest`s possible suitors centered on American and Delta Air Lines and Icahn. A New Jersey-based real estate company, Vornado Inc., was also rumored to be taking a position in Northwest`s stock.

Northwest`s stock soared $5 a share, to $54.25, in heavy trading, and Delta`s stock rose $2.87 a share, to $49.87.

Northwest officials said they knew of no reason for the stock`s activity. Spokesmen for both Delta and American denied any interest in buying Northwest. ``American hasn`t had any talks with Northwest, doesn`t plan to have any and doesn`t own any of its stock,`` said a spokesman for American.

Neither Icahn nor Vornado officials could be reached for comment Wednesday. Icahn, it was rumored, may be prepared to bid $80 a share for Northwest, which has 21.7 million shares outstanding.

Northwest shareholders recently adopted a so-called shark-repellent provision requiring 75 percent ownership of its shares for a takeover. The airline has been consistently profitable and is considered attractive because of its strong cash position, small debt load and successful trans-Pacific route network.

It owns its large fleet of jets and is buying more planes for an expansion of its domestic and overseas operations.